The people closest to the work know where the hours go. So instead of buying another tool, The Back Room handed the problem to its own teams, put real prize money on it, and ran an AI hackathon on itself.
In this episode, Wayne Findlay (CEO, The Back Room) and Marvin Galang (COO, The Back Room) share what happened:
One thing to do this week: run the one-day version. In the morning, pick the task that eats the most time. In the afternoon, let small mixed teams fix it with the AI tools you already pay for. Next week, kill or commit, and put a name next to it.
Transcript:
[00:00] I think I know enough to be dangerous to be honest I did not even expect software to come out prize money Philippine pesos for the team and it was quite a substantial is it gonna affect me is it gonna affect us people were to some degree have some fears they don't see it fearsome anymore they see it as a friend now they cannot work without AI the whole internal operating system I don't know how they built that in two to three weeks yeah and for some software companies those become redundant because of what we've built
[00:38] Highly recommended don't build it whose idea was the head chef that was collective idea Wanna own it
[00:47] You're listening to unaccounted for well what is unaccounted for it's the podcast about everything the Ledger doesn't capture gonna cover AI people and what's really going on inside accounting firms I'm Marvin Galang and I'm Wayne Findlay from the back room no slides no CPD's and nobody well maybe maybe we're pretending no we're not no pretending they've got it all figured out
[01:16] Alright we're back we're live for another session that was good that last session we did I thought that was you know thinking
[01:25] There's a lot I don't know and I think I know enough to be dangerous that's ha ha ha ha ha I feel in that dangerous mood we we test and iterate as you have you heard of um used to be ready aim fire right yeah oh it is like that just fire fire and fire and then you aim later yeah gosh you just gotta test all of these yeah and I think I'm gonna put that into a context for you like when we
[01:58] It was it your idea the hackathon whose idea was the hackathon that was um well collective idea I don't own it you know I think there's a big contribution from the team but we were talking about
[02:13] AI is here we know it yeah how do how do we embed it in our DNA yeah and hey let's try a hackathon is that a common term a hackathon is that what someone else has done it and called it a hackathon or did we come up with that no it's a common term it is a common term it's a you for software
[02:35] Well it's a term in software yeah where they really try to test ideas and and see what comes out I think software development companies have done this yeah what do they call it do they call it a big sprint or where they lock themselves in the room for two days and they have um you know lots of ice cream and whatever it is and games and breakouts and they just build the software they just build software I heard they're 24 hour hackathons so like Hackathon Marathon you know that type uh but yeah they
[03:11] They just it's a set amount of time I've heard 24 hours for some they don't sleep yeah they you know they code their way that's how they do it and nowadays it's so fast to code right they can put it in play and put it out in a little space and test it and see if it works or not so yep yeah it's interesting but I suppose the way we did it
[03:32] And maybe our vision for it was a little bit different it was over a period of time yep and it was really I when I first saw it I thought oh yeah we'll we'll get some products out of this maybe some of it will be useful I did my expectations weren't high because I've never done it before cool in fact um we had very very low expectation on what's gonna what's gonna be the outcome yeah to be honest I did not even expect software to come out yeah I was expecting more process
[04:09] Process system yeah you know improve workflows and you know identify what tools I can use to improve this workflow right yeah um but and again we're talking about accountants 80% of our team is our accountants we have an internal team that's you know that's obviously non accountants yeah and so like what can we're not expecting them to develop so we didn't do 24 hours we have a set time that's I think it was eight weeks yeah you know to complete the the process
[04:45] But again the output should be this is an improved process improved workflow but not an actual software not actual software but we like how we ran it we put it out there we we offered prize money in in Philippine pesos for the team and it was quite a substantial amount so it was there to incentivize right
[05:10] Um and most of the team took it up internally there was a few accountants that took it up you know externally that work for other clients mm hmm um and we how did we we managed that in a way because they had to put a proposal to us didn't they on what they were going to look at and fix right we encouraged everyone to join um
[05:35] Internal team our client facing team members the goal is really to see um bring out ideas you know from them and be able to visualize and execute on these ideas that was really it so they had to pitch their ideas to us exactly so you have to pitch the idea because
[05:58] We have to evaluate whether these are yeah and we don't wanna waste our time too no we don't wanna waste their time developing say something for Elon Musk to put in his rockets that weren't gonna benefit us correct plus we will equip them with the tools and the tools we have to pay and we had a developer time as well there were developers available correct um and but they weren't really needed to be honest but they were available that we could help them with as well right yeah
[06:29] But so they pitch the ideas but when can you remember those first pitches when they came back to us what they were like oh the first um I remember we had one on oh we have a lot of interns yeah but our interns are they don't go on payroll yeah right and and unfortunately we pay you know per per head on payroll and so we somebody pitched an idea of developing a timekeeping
[07:00] And in a way payroll computation for intern it was um it was good um fixed assets also yes I remember that one fixed asset module we use Xero's fixed assets um there were limitations with it wasn't there correct that we had based on our situation being in the outsourcing business um
[07:23] There was a lot more reporting we had to do than you would normally have I remember when I was doing fixed assets for clients right yeah we had to have serial numbers and pictures and all sorts of things to report to different bureaucracies here in the Philippines in the Philippines yes every permits that we have to get to you know to take uh equipment out and to bring them in
[07:45] So yeah an idea came out on fixed assets which was really yup we also had one for payroll they wanted to rebuild the whole payroll system didn't they yeah but we actually didn't want to do that cause there was a risk involved huge risk so they ended up building you know just the back end report after processing payroll cause we have a different payroll software in the Philippines which is not connected to Xero um the challenge is now how do I get these numbers in the accounting software because you know we have hundreds and hundreds of employees
[08:20] And it's different departments and yeah it's just a mess um doing it manually yeah and then there was the guy that developed the work papers yes that was an idea um I think this is from Australia developed the work paper for tax and accounting so yeah shocking it was shocking um
[08:45] I mean good way shocking in a good way yeah so so that I suppose we talk about the environment you need to culture that you know I know that we we we work off a fundamental and I think um we've ingrained those in our team and and so everybody knows their fundamentals
[09:09] I always incentivize them at every event but we have a couple that relate to change one is about embracing change and I think we have another a good fundamental which is about kaizen or always improving looking at ways to improve yourself and your systems so yeah and I think that was embodied as part of the hackathon wasn't it is that we're improving our systems
[09:36] But maybe if we step back and say what else did we improve what was the result of it it cause it just blew everything up didn't it yeah it's really a step up on you know the company's culture if you think about it um
[09:55] There were questions in terms of hey where you know we've always talked about hey AI is here you know is it gonna affect me is it gonna affect us um and people were to some degree you know have some fears it was yeah uh and then here we are having a hackathon and I'm like uh what are you guys doing that type of thing a lot of doubts uh in the beginning the one we remember some discussions with our leaders
[10:26] There were a lot of doubts uh but yeah we just stuck true to the fundamentals of improving and you know and and and now they cannot work without AI they can't what it's done is it's ingrained AI they don't see it fearsome anymore they see it as a friend yeah it helps them along and so now every department is using AI and using it to help improve systems and yeah do a better job basically so and
[11:03] And that doesn't happen all over you not all companies would embrace um change the way we have yeah um put in a strategy you know to embed that in their culture embed that in their DNA yeah and and and be able to experience that journey all intents and purposes I think what it did is really
[11:30] Souped up their resume as well can you imagine putting in your resume the skills the skills they've learnt yeah I think that's one of the huge benefits not only did we get the you know some some cool product which at the end of was software wasn't it that they built correct so it was actual software it wasn't just a process so we actually had something tangible
[11:54] But the other thing was it built the culture and it made them better at what they're doing so yes yeah so I think it was there was a lot of things that came out of the hackathon that I never thought would get this development of people that we did yeah so yeah well secondary we did say hey yeah improvement and you know trying to embrace AI but the secondary goal was really hey how do we what is a true AI first or an AI enabled
[12:27] Yup what does that look like and and I think we got it I think we did'cause then we ran a second one yeah and that was just recently well recently six months ago would it yeah but right and so the second one that we ran we had a lot more people apply but the the level up on what was being developed or projects that they worked on was was massive wasn't it yep I guess they saw the the you know
[13:03] The benefits of having you well the first one that the in the first hackathon the winner was uh I think the fix assets yeah yeah so primarily accounting in nature um there's one accountant there and I think it was it yeah but then this second one now we have and and HR did not join the first one no but this second one you have now different teams different departments that are that you know we did not even uh anticipate that they would join yeah
[13:40] And the ideas are are they're insane they're it was you know you can see that they understand the their pain points they obviously they champion the workflows they they are the master of the workflows uh and they just want to improve it yeah well talking about AI
[14:01] And I know a lot of accounting firms will wanna talk about this and go over it so if you wanna go and learn more go to the show notes or tap on the link and the link domain it's called unaccounted for podcast.com alright let's go back to this podcast episode back to it
[14:23] And and so what they're working on well finished called what's it called Infinity Infinity which is a great name for a for a project yeah I think the acronym is iOS right iOS Infinity operating system yeah or internal operating system which is that's what it is it's a it's a whole internal operating system yeah that covers
[14:49] I don't know how they built that in two to three weeks it's like I think what no what what's interesting is that it's um yeah that is the collective and end result but the individual teams that joined yeah have their separate ideas yeah so you have um recruitment or talent acquisition you know you have um account management the AMS and then you have HR and admin you have admin yeah and so they have different ideas yeah and I think what happened is when we saw that um
[15:27] You know they're gonna be working on same data data points it's really one it should be one cohesive system yep um which is an operating system in a way of a of a of a department or a team yeah so and that's how they combined uh everything after and to what they has done is now we we retire software that we previously would have used
[15:57] For those yeah unfortunately yeah for some software companies for some so the legacy software companies you know I suppose we can Monday dot com was an example of one that we used for certain workflows yeah and Active Track was another one that we used those become redundant because of what we've built within Infinity which was our own software right so I think that's something that is playing out in the wider environment isn't it in in the world you're seeing a lot of that happen
[16:33] Correct yeah correct correct um yeah
[16:39] We're fortunate in a way because we're able to identify what applications because we talked about this in the prior episode or other episodes but you know the SAS businesses really SAS industry really dead and we said hey no we don't believe that they're gonna have a different set of value proposition to the market yeah in our case we just had to identify hey um
[17:09] Are we able to integrate this with what we built uh or do we build it ourselves yeah so you make that you have that choice whereas before it was a choice of software yeah now it's a choice do you build it yourself or invest in someone to build it for you or do you buy it off the shelf and develop it yep so that's something that wasn't there 5 6 years ago so yeah it certainly opens it up
[17:40] I wonder how we build that like how we move that into the accounting firm today hmm if you were to set up an accounting firm let's say you had five or six partners 30 staff
[17:55] What systems you know what's that gonna look like now compared to what it would look like you know 10 years ago there's a lot lot different isn't it you can I know how how I would shape a an accounting firm now compared to what it was when Scott and I were accounting yeah you could build a lot more processes around
[18:18] Onboarding a staff and onboarding of clients right used to be a bit of a process yeah all that could be done now well starting a CPA firm I would still start by identifying these workflows and then matching them with probably an existing app yeah I don't want I'm of course you're not gonna build I highly recommend that don't build it you're not gonna build a new Xero or a cryptobox no don't build a Ledger don't build a proposed a practice ignition yeah
[18:56] You know or a or a carbon or a canopy don't um uh no yeah that's not what we're sharing or we're preaching but off off the side of that you could build little apps to help things exactly better so once you have that in place you you have your ways of eating yes and you will certainly identify hmm um there is a gap between what this application is able to do for me and you know and the and I need the bridge to get it here
[19:34] And you will always see that gap and I think that's where that's where you now start maybe I can build that like it if you're an accounting firm and you specialize in dentist say or in health mm hmm you could build a stack of stuff around that to supplement what you're doing whether it's like dashboard reports or right benchmarking or it could be I don't know it could be a lot of things that you're pulling data in and and manipulating that and delivering that to the client to add value to what you're doing
[20:11] So there's a there's a so many like I say there's so many opportunities out there yeah that you could do I'm sure when you were running your firm you have I you have identified a lot of those you know it's like oh man Xero can do this Xero spotlight can do this and yes but in between I wish I'm able to do this yeah you know we
[20:36] We have a we have tons of those I know we in our accounting firm we used to specialize in that building industry yeah and so I think now with marketing there's a lot you could do with AI you could build stuff around marketing and events and different ways to target or get leads there's a lot that you could do with your marketing AI for an example
[21:06] Well I'll give you a big one at least for me this is big yeah you know how credit card companies are able to message you or text message you when there's a charge that comes in Wayne yeah I'll keep them all the time APEX boom boom boom I don't get that in a bank account
[21:27] No it's like but if you have a bank account that's connected to your accounting software that pulls in transactions every night yeah I would want an agent to read that and then tell me hey can you text me uh any amount that you've seen that's over you know I don't know $2,000 or whatever your threshold or your materiality right so you could run that across clients and yeah I mean at least for me that's important because maybe my team doesn't reconcile every day yeah you know like
[22:02] Oh you do a weekly reconciliation by the time the transaction already happens like uh it might be too late yeah but anyway I just something that came up with uh with with it's a simple workflow but yeah for me it's valuable to me not being in the books like daily
[22:23] Not being able to reconcile every day but I want my software to tell me uh you know $2,000 uh $10,000 came out of your bank account yeah you know and I don't normally spend that much so what are those right that's a good maybe so you really want it's Jenny shopping and I want to know my wife was shopping so yeah and using company company bank account
[22:50] That's a yeah that's what yeah I won't go into the golf club with you no um but that's the sort of stuff you want to incubate within your firm and how you do that is is where how you create that atmosphere and a hackathon might be an example of doing that yeah um
[23:12] I I Justin is a sign we're talking about software and clawed code and I built something and this could be useful for accountants to do with insurance oh how many times I don't know I get insurance policies you gotta fill out and they're pages long right just and and all the information is there and you gotta fill it out once you gotta fill that out for the different
[23:38] You know if you're going through a broker for how many different firms you're gonna get insurance from so I I loaded in all my old policies all my insurance I gave it all the detail and poor code and then I said here fill out this policy form for me yeah and it did yeah and then I asked it to go to check it obviously I if there's some stuff that I didn't know it came back to me but now I've built this I call it an app on insurance right um it knows all my insurance
[24:13] So now I can query it about my insurance it picked up a lot of stuff that I was wrong in the policy some spelling errors different levels of you know what would you call it your no claims and all this it there was a lot experience yeah and and maybe there was a wrong address and some so it picked all that up it was real beneficial but now when I renew next year it's so easy right but that's something you could do for clients if you're an accountant yes if you built that you could roll that out for your account
[24:49] That it's a save them a lot of time for your bigger clients I imagine so it's really about creating that atmosphere or that culture of change and I don't think a top down you need to create it by we created it by having the hackathon but it was bottom up yeah and I think that was the beauty of the hackathon and I think that could be replicated anywhere couldn't it absolutely and I hope it I mean
[25:17] You know the the the team members the staff works on clients work on they're doing the day to day yeah we only get to be alerted when there's a problem or there's a decision to be made you know we don't see that don't see the improvements but I think what the hackathon really did is say how do you really know you know what you guys are doing how do you really yeah and cause they're the ones who knows how to improve it yeah and it came out
[25:45] It's just no it's amazing it's amazing oh well I think um we I think we can say you have you brought well before you wrap up because this is the next topic in future sessions yeah because you you brought up you would talk about context yeah and um you know context on the insurance where you're plugging in all your experiences and data and all that stuff and I think a good conversation or hopefully something we can share is you know how
[26:15] How can firms or organizations effectively train their AI yeah with a firm knowledge or yeah like a firm brain you I know you're gonna say the firm brain yeah but that that's that could be a great topic yeah um for the future yeah and the use cases that they can how they would use it yeah
[26:43] Cool alright there we go we get us talking on AI and we just keep going on yeah so alright no alright well time for coffee another coffee stop alright thank you thanks and if you wanna talk about AI in your firm it's all in the unaccounted for podcast.com again unaccounted for podcast.com and the links is down there in the show notes oh well that's it then so I'm Wayne I'm Marvin and that's been what the lecture doesn't capture
About Unaccounted For
Unaccounted For is a podcast from The Back Room Offshoring about AI and the future of accounting firms. Each episode, CEO and Founder Wayne Findlay and COO Marvin Galang talk through what is changing, what is hype, and what firms can start using now.
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Wayne Findlay on LinkedIn: linkedin.com/in/waynenz
Marvin Galang on LinkedIn: linkedin.com/in/galangmr
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